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Tuesday, April 3, 2012

It’s always a good idea to get your item
examined by a professional appraiser prior to entering a pawn shop. That way
you’ll know how much it’s worth and whether the pawnbroker is offering you a fair
loan or buy amount.

-Understand market value vs. retail
value

Make sure you understand the difference
between market value and retail value. Market value refers to how much your
item is presently worth given its condition. Retail value is how much the item
was worth when it was brand new.

Reputable pawnbrokers should be lending you an
amount equal or close to the real-time market value. When pawning an item, you should always be
aware of how the shop determined the percentage of value it offers customers.

-Verify pawn security

Before pawning an item, make sure that your
possession will be safely stored while you pay off the loan. Also, it’s
imperative that all record-keeping is electronic so the transaction documents
and loan details aren’t lost.

-Identify loan interest rates

Pawn loan interest rates vary depending on
individual state regulations. For instance, Florida pawn shops can charge
customers a rate of 25 percent, regardless of the loan size. The average at
traditional pawn shops is 10-20 percent.

-Research the pawn shop’s reputation

Any pawnbroker you work with should be
officially licensed by their local government. It’s also worth doing some
online research to see if there are negative reviews.

-Understand
the differences between gold-plated and gold

Be aware that “gold-plated” doesn’t mean the
same thing as “gold.” Gold-plated items usually aren’t worth that much and many
pawn shops won’t accept them.

-Read
the fine print

Carefully
go over the loan paperwork to make sure the pawnbroker isn’t trying to slip one
past you. Unfortunately, some shops attempt to burden customers with additional
fees and storage costs. Just make sure you know what you’re getting into before
signing any pawn loan agreement.

-Be
alert for hidden fees

Hidden
fees in pawn loan contracts are not okay! Your pawnbroker should be completely
up front with you about all associated costs with obtaining a pawn loan.

-Clean
or refurbish your jewelry before pawning

If
possible, have an expert clean or refurbish your jewelry before bringing it
into a pawn shop. The reason? You might get more money for the item if it looks
brand new.

-Know
which items are best for pawning and selling

Before you
pawn, understand how your local pawn shop operates and the types of items they
usually loan on. You should also know when it makes more sense to sell
something rather than pawn it.

For
instance, if you want to upgrade your iPad, it’s best to sell the old version
and spend the cash on the latest Apple tablet.

On the
other hand, precious metals usually increase in value over time, so pawning
them allows you to get a quick loan while retaining ownership, just in case the
price of silver or gold skyrockets in the future.